Q: I paid a deposit of £1000 over the phone for a used Audi A4, subject to seeing the car. However, two weeks later, due to a change in my financial circumstances, I had to cancel the deal. The dealership then refused to refund all of my deposit stating that it had incurred some costs. I had not been to the dealer to sign any paperwork. Can the dealer refuse to refund all of my deposit? David Jackson
A: Usually a verbal agreement is binding, unless a finance agreement is involved in which case you always need signatures on contracts.
However, if you have only dealt with the dealership over the phone, so have not visited to inspect the car for instance, you could well be covered by Distance Selling Regulations.
These regulations entitle consumers that buy goods over the internet or the phone to a seven-day cooling off period once they've taken delivery of the goods. Within this period you can call the whole deal off, without explanation, and are entitled to a full refund.
That means you could go through with the purchase of the car, take delivery of it and then tell them to take it away again and write you out a cheque.
Explain that to the dealer and he may well quickly come up with the rest of your deposit rather than pointlessly incur more costs delivering the car and then taking it away again.